Jack Scoville is an often quoted market analyst in the grain and soft commodities sectors. You will find his commentary throughout the Reuters, Wall Street Journal, Dow Jones, Bloomberg, and Barron's publications. Contact Mr. Scoville at (312) 264-4322
General Comments Cotton was sharply higher. Support is coming from ideas of improved demand for US Cotton. The weekly export sales report showed another solid increase in sales with China as a buyer. China is asking its industries to ramp up imports of products to avoid any problems later in the year. Vietnam was also a good buyer. The world is starting to slowly recover from the Coronavirus scare and some stores are starting to open again after being closed for weeks. The hope that consumer demand for Cotton products will quickly return is not likely to be confirmed. Consumers have really been hurt economically due to stay at home orders imposed here and overseas and it will take some time for them to recover. As an example, Chinese stores have been open for several weeks but there has been no consumer rush to go to them and buy. The same is possible here and in Europe although the data so far is mixed in this regard. It is too dry in Brazil for good growth of the second crop of Cotton. It is also dry in the Texas Panhandle and producers there are getting worried about production potential.
Overnight News: The Delta will get periods of scattered showers and isolated showers this week and Southeast will get scattered showers. Temperatures should be mostly near to below normal. Texas will have scattered showers. Temperatures will average near to above normal. The USDA average price is now 54.77 ct/lb. ICE said that certified stocks are now 5,830 bales, from 4,646 bales yesterday. ICE said that 0 notices were posted for delivery against May contracts and that total deliveries for the month are now 10 contracts.
Chart Trends: Trends in Cotton are mixed to up with objectives of 6190, 6670, and 8910 July. Support is at 5740, 5680, and 5640 July, with resistance of 6050, 6100 and 6120 July.
General Comments: FCOJ was higher again yesterday as trading volumes start to come down for Memorial Day. Trends are still up in the market. The Coronavirus in Brazil is being watched as exports could be affected. Support is coming from the continued effects from the Coronavirus that are keeping people at home and drinking Orange Juice. Demand from grocery stores has remained strong in response to the increased consumer demand. Oranges production was estimated as less in the latest USDA reports at below 70 million boxes, so supplies available to the market are somewhat reduced. Inventories in cold storage remain solid so there will be FCOJ to meet the demand. The weather in Florida has become a mixed bag over the last few weeks. It has been very hot and dry in south Florida but the north has gotten a lot of rain. Southern areas are cooler now and have seen showers in most all areas. The midseason Oranges harvest is diminishing. Irrigation has been run several times per week in most areas. Color break is reported on late variety Oranges. More signs of early bloom and new growth on trees are reported. Favorable weather is reported in Brazil but it has been dry and irrigation has been used.
Overnight News: Florida should get frequent periods of showers. Temperatures will average near normal. Brazil should get scattered showers and near normal temperatures. ICE said that 0 notices were posted for delivery against May contracts and that total deliveries for the month are 0 contracts.
Chart Trends: Trends in FCOJ are up with objectives of 126.00 and 132.00 July. Support is at 125.00, 121.00, and 120.00 July, with resistance at 130.00, 133.00, and 136.00 July.
General Comments: Futures were lower in light volume trading as world economies continue to slowly open. The spread of the Coronavirus in Brazil is being watched as it could really affect exports. The demand from coffee shops and other food service operations has dropped to almost nothing but should soon start to improve. Consumers are still drinking Coffee at home, but many smaller roasters are actively trying to unload green coffee already bought a there are only a few outlets for sales at this time. This might change a bit in the next few weeks as the US and EU economies slowly open up. The logistics of moving Coffee from Central and South America remain difficult. Producers have had trouble getting workers to pick the cherries and mills and processors have had trouble getting workers to staff the plants. Shipping logistics have improved somewhat, but many are still having trouble getting the Coffee to ports to move to consumer nations. Vietnamese producers are not selling due to the weaker prices paid currently and the effects of the Coronavirus. Indonesian producers are more active sellers.
Overnight News: ICE certified stocks are higher today at 1.793 million bags. The ICO daily average price is now 105.37 ct/lb. Brazil will get scattered showers on Sunday after a dry week with near to above normal temperatures. Vietnam will see light to moderate showers. ICE said that 9 notices were posted for delivery against May futures and that total deliveries for the month are now 898 contracts.
Chart Trends: Trends in New York are up with objectives of 113.00 and 118.00 July. Support is at 105.00, 103.00, and 102.00 July, and resistance is at 110.00, 113.00 and 115.00 July. Trends in London are mixed to down with objectives of 1130 and 1090 July. Support is at 1150, 1110, and 1080 July, and resistance is at 1200, 1210, and 1230 July.
General Comments: New York and London closed a little higher in consolidation trading. The Coronavirus is being watched in Brazil as exports could be affected. Ethanol production is the key for Brazil, but prices of Sugar are competitive right now. Prices in petroleum futures remained generally firm last week but still have a long way to go before Ethanol processing becomes profitable again. However, Crude Oil is facing increasingly bullish fundamentals now with the recent production cuts and the world economies starting to open up and promote more use of petroleum products. More Sugarcane became available for processing into Sugar but the production mix could shift back to ethanol. Reports indicate that little is on offer from India in part due to logistical and harvest problems caused by the Coronavirus. Thailand might also have less this year due to reduced planted area and erratic rains during the monsoon season. There are reduced flows from rivers from China as well.
Overnight News: Brazil will get scattered showers on Sunday after a dry week. Temperatures should average near to above normal.
Chart Trends: Trends in New York are mixed. Support is at 1040, 1020, and 990 October, and resistance is at 1130, 1160, and 1180 October. Trends in London are up with objectives of 408.00 August. Support is at 358.00, 347.00, and 340.00 August, and resistance is at 367.00, 387.00, and 396.00 August.
General Comments: New York and London were a little higher in consolidation trading. The virus has complicated farming and marketing efforts. Ideas are that deliveries can be slower on any contracted Cocoa and that the next crop could suffer as workers stay away. Analysts interview by Bloomberg News estimated the grind in Europe and North America moderately lower. The Coronavirus helps keep demand away and helps keep workers from grinding facilities and chocolate manufacturers. Harvest is now over for the main crop in West Africa and the results so far are very good. Ideas are that demand is less than before due to the Coronavirus problems in Europe. The reports from West Africa imply that a big harvest in the region.
Overnight News: Isolated to scattered showers are forecast for West Africa. Temperatures will be near normal. Malaysia and Indonesia should see showers. Temperatures should average above normal. Brazil will get mostly dry conditions and near normal temperatures. ICE certified stocks are lower today at 4.295 million bags.
Chart Trends: Trends in New York are mixed. Support is at 2380, 2340, and 2310 July, with resistance at 2470, 2490, and 2510 July. Trends in London are mixed. Support is at 1940, 1910, and 1890 July, with resistance at 1980, 2000, and 2030 July.